Portugal is a country on the Iberian peninsula, the most westerly European state in Europe. It is a parliamentary republic, and the capital is Lisbon.
Advantages of using Portugal as your jurisdiction of choice:
1. Membership in European Union, NATO, OECD
2. A Schengen state
3. Official currency is the Euro
4. Political stability
5. Favourable business conditions
6. Foreign investment promotion programs
7. One of the lowest operational costs in western Europe
8. Easy terms of the economic citizenship program
9. Nominal service of directors and shareholders is available
10. Operating free-trade zones on Madeira and the Azores with special tax regime
11. No currency control
12. Wide participation in double taxation treaties
A limited liability company (Sociedade limitada, Lda) is the most popular type of company. The distinctive feature of the jurisdiction is that the owners hold quotas in the company, rather than shares.
What documents will you receive upon company registration?
• Notarised Certificate of Incorporation
• Memorandum and Articles of Association
• Extract from commercial register
• Certificate of registration in social security and accident security bodies
• Certificate of registration in the local office of the Ministry of the Economy or DGE(General Directorate for Energy) of Portugal
Taxation and statutory requirements at a glance
The standard corporate tax rate in Portugal is 25% for all entities.
Other tax rates:
• VAT – 25%
• withholding tax on dividends – 25%
• withholding tax on interest – 25%
• withholding tax on royalties – 25%
• on lottery prizes – 25-35%
• on rental income – 15%
• on consulting and management service payments – 15%
• progressive personal income tax – 14.5% on €7000 or less, through to 48% on €80,000 or more, of annual income
All taxes should be paid quarterly in advance.
Accounting, audit and filing requirements
Accounting is obligatory. An annual report has to be filed and can be viewed by the public. An audit report is necessary if two out of the following three conditions are met in two consecutive years:
• total revenue is €3 million
• total assets are more than €1.5 million
• company staff is 50 or more